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24 August 2018

Growth and earnings targets for 2018 confirmed

The Neutraubling-based manufacturer of filling and packaging technology was able to offset the slight first-quarter decrease in revenue in the second quarter of 2018. At EUR 1,790.8 million, revenue in the first six months of 2018 was up 0.9 per cent from the prior-year figure, which had been quite high due to timing.

Order intake rose 13.2 per cent to EUR 2,014.8 million. Acquisitions had no significant impact on revenue or order intake in the first half. At EUR 1,464.1 million, orders on hand were up 27.4 per cent at the end of June 2018 over the prior-year period (EUR 1,148.8 million).

Earnings before taxes (EBT) decreased 6.9 per cent to EUR 112.7 million due to a one-time effect within personnel expenses and rising expenditure for goods and services purchased. The EBT margin decreased from 6.8 per cent to 6.3 per cent. In the second quarter of 2018, the EBT margin was unchanged year-on-year at 6.3 per cent. After taxes, consolidated net income was down 6.7 per cent to EUR 76.9 million in the reporting period. Earnings per share for the period decreased from EUR 2.64 in the previous year to EUR 2.45.

The company’s free cash flow improved by EUR 103.3 million to –EUR 56.2 million in the first six months of 2018. The ratio of average working capital for the past four quarters to revenue increased to 28.8 per cent (previous year: 26.3%). As a result of lower earnings, Krones’ return on capital employed (ROCE) dropped to 15.5 per cent in the first half of 2018 (previous year: 16.3%).

The Executive Board confirms revenue and earnings targets for 2018. The company expects six per cent revenue growth and a reported EBT margin of 7.0 per cent.

The manufacturer of filling and packaging technology expects its third financial performance target, working capital to revenue, to improve slightly in the second half of 2018 compared with the first half. However, they will not meet the 26 per cent forecast for the whole year 2018. The company’s new target is 28 per cent.